Jump to content
The forums have been archived and are now read only. Years of great info saved for your reading pleasure. Thank you! Visit us on Facebook: https://www.facebook.com/NakedInvestor/ ×
The Naked Investor Forums


  • Content Count

  • Joined

  • Last visited

Community Reputation

0 Neutral

About jcjohnson7

  • Rank
  1. Now there's a problem. They seem to as plentiful as herds of unicorn right now. I tried refinancing a property last year and it took a full year to do it (closed March of this year) because they all seem to keep disappearing. Let alone trying to find one that actually knows what he/she is doing... *Still bitter*
  2. How would this come back at me? I haven't attempted a deal with numbers like this so...
  3. MC, Would it not affect offers we are currently sending out if it is definitely going into effect so soon? I wouldn't want to stick a t/b in a property that has no hope for financing and/or muck up the deal from the get go.
  4. So are you guys saying that most lenders are now looking at the option consideration and the rent credits as seller concessions? And that, as of April 15th according to the new guidelines put forth by HUD, those together can not total more than 3% of the purchase price? Or am I missing something? Because if that is the case, it will certainly impact our business greatly I would think.
  5. Ok, so I am set to send a Short Offer to a seller for a CA but he owes about $13,000 more than it's worth. Here are the details: Seller owes $153,000 He has it FSBO @ $149,000 Seller payments = $1,290/month After running comps, fair market value came to $138,000 County assessor has it appraised for $140,000----Not lookin' good for the seller... I originally had the offer structured like this: Offer to seller: $140,000 $1,300/month for 24 months (a little high but the house is really big for the area with pool, huge deck, etc.) 25% rent credit totaling $7,800 after 24 months $4000 option consideration Total $151,800 Now, he is motivated because he is in the Air Force and is being stationed in FL in 30 days. There is a good chance they will accept this offer. Do you guys ever do CAs where the seller is upside down like this in terms of equity or do you think doing a consulting job would make more sense in that he could get a little more for his house? I just don't know if maybe I should put it on the market for that price and see what response we get or if going straight to a consulting agreement would the proper move. What have you guys done with upside down deals like this? (There are a bunch out there ) I just want to make the best use of my time and his. He told me he had thought about doing a lease purchase but he doesn't really know where to start. Josh
  6. Hi all, I spoke with a gentleman about doing a CA and he told me that he was going to list it with an agent and try to sell it the traditional way in 60 days. Now if we try to do this deal and he decided to go ahead and list it with an agent, do my obligations in the deal change or does it affect me at all? I have been avoiding the realtors for the most part since I'm just starting out, but was just wondering how you all would handle a situation like that. Thanks. Josh
  7. I am meeting a seller tomorrow to complete the agreements for a CA and if his wife is not able to make it in town to meet me, how can I handle the signatures? In TN I have to get the signatures of him and his wife in order for the deal to be legally binding since the house is owned by both of them. Can I let him take the documents home, let her sign, then he fax them back to me? I won't have the original hard copies if that is the case and she may not sign. Same thing if we do it by e-mail. I would like to have an original hard copy with all signatures but was just wondering if a faxed copy would be legally binding as well? How do you guys handle the paperwork with out of town owners? Josh
  8. Hi all, I got a seller to agree to my short offer and I am meeting with him tomorrow to take a look at the property. However, he owes about $4,000 more than what I offered him. Is there anything to be concerned with here? Once they decide to close, nothing can come back to bite me right? I am doing a CA and just wondered if I had no worries after all agreements are approved and I'm out of the deal. I know the seller will have to come up with the difference to pay off his outstanding balance. Do you guys ever take less than what you're selling it for on a L/O? Or is it a take it or leave it deal for the most part since the numbers work out already? I guess it would be up to the homeowner; if they are willing to take less for it. If not, then it may take a while to lease right? Anyone have a thought on this? Josh
  9. Ok cool. We'll see what happens...Thanks for your help! You tha man MC
  10. Yeah, yeah, I know... Just one more question though. Do I put the total purchase price on the short offer or the net price the seller is receiving? The expiration date on the short offer, what kind of time frame do we usually look at putting for that?
  11. Ok good deal. Sorry, I just found that cancellation paragraph. My mind is moving too fast. By the way, am I supposed to put the total price (net price +rent credits + option consideration) on line 1c in the Option to Purchase Agreement? If I advertise the home for the total price and then a tenant/buyer has more to put down than the option consideration I had projected, how do I work that into the total price if I only have enough for the price I was planning on getting? Does that make sense? $76,500 has room for $70,000 + $4,500(rent credits) + $2,000(option consideration) Do I need to advertise my price high (maybe a couple thousand more?) to make room for that sort of thing? And if that is the case then the full purchase price might end up being lower than what I put on the option to purchase.
  12. So should I not tell him that I'm selling it for more money to include the option consideration and the rent credits? All he needs to know is what he's getting for it? Does anyone ever question why you put such a low dollar figure on the short offer? I honestly don't know how long it will take to find a tenant/buyer. That's why I'm planning on marketing the thing like crazy. You said in your manual that we should always put a "right to cancel" in any agreement that we do. I didn't see one in any of the CA agreements that I have. Do I need to add one?
  13. I was just set on 50% because you said in your manual that it will move the property much faster. So you have had good success with 25%? If I were to do that then I could offer the seller $70,000 List it @ $76,500 @ $750/month for 24 months 25% rent credits of $187.50/month totaling $4,500 after 24 months $2000 option consideration So when I fill out the Short Offer form, I should start the lease about 2 months from now? How much maintenance do you generally ask the tenant/buyer to be responsible for when filling out the short offer? The option period is the same length as the lease on a CA right? How much option consideration do I put on the short offer because that is going from me to the seller so it is basically saying I'm giving him option consideration right? Lots of questions, I know...
  14. That makes sense. Well, what I could do is offer the seller $70,000 List the property for $76,500 @ $750/month for 12 months 50% rent credit totaling $4,500 after 12 months $2,000 option consideration Having a shorter lease makes it a better deal price-wise for the tenant/buyer and the seller as a whole but it's not as much time to get their credit up to par. Do you think shortening the lease period would be a better deal for everyone?
  15. I feel like the dog that caught the bus. Ok, so here's the deal. I spoke with a seller last night and he wants to go ahead and see what we can work out. I told him I would send him an e-mail with the short offer attached for him to look over and agree to, then we can schedule a time to meet at the property. However, I'm starting to question whether or not this is a doable deal or not. Here are the details--let me know what you guys think. Listed FSBO @ $78000 (It's in a neighborhood with a mix of owners/renters) Currently rented until Friday @ $800/month His payments are just under $700/month to cover everything Comps: Yr. Built Sale Date Sq. Feet Sale Amt. Parking Material Total Comp 1 1957 08/03/09 966 71,034 carport brick 71,534 Comp 2 1961 08/03/09 1,092 68,000 drive brick 68,000 Comp 3 1954 06/02/09 1,266 31,150 carport shingle 31,150 Comp 4 1952 08/11/09 1,027 60,000 drive brick 60,000 Comp 5 1957 08/05/09 1,302 74,691 garage brick 76,691 Comp 6 Subject 1956 06/24/09 1,344 NA drive NA brick NA 51,229 Today's Date 09/22/09 942 $ per Sq. Ft. 54.37 After Repair Value 73,078 So I came up with 73000 for the market value (assuming the tenants haven't destroyed it) He has someone coming out Saturday to clean the place up he said. He's also an out of town owner who had to rent it so he is motivated. The rents for that neighborhood are between $650-750/month for a 3 bedroom (which his is). He has it rented for $800. Now, I figured I might be able to get it leased with a 50% rent credit if we keep it at the 800/month. BUT that is $9600 over 24 months which has to be added to the price. I figured $2000 for the option consideration because 3 months rent is $2400 and 3% of price is $2190. Maybe it's too low, I'm not sure. So either I offer $84600-85000, which is too high for that neighborhood. OR I offer $61000 to 61400, which is way below what he is asking for it, but it is closer to the other comps in the neighborhood. He bought it for 77k. (Foreclosures killed that area) I was thinking of listing it @ $73000 @ $750/month for 24 months. $2400 option consideration. 50% rent credits totaling $9000 after 24 months. Offer to seller would be $61000 Does this make sense? Let me know what you guys think. Josh P.S. I have a lot more questions but I just want to know what you all think.
  • Create New...